The new disclosure pilot is a once-in-a- generation opportunity to modernise litigation

The consultation on the proposed two-year pilot of a new disclosure practice direction closed on Wednesday 28 February. The proposed pilot is extremely broad, applying to all claims in the Business and Property courts except competition claims and those within the Shorter and Flexible Trials Schemes. It aims to reduce the costs, scale and complexity of disclosure. The key proposed changes include:

• An express duty to send “litigation hold” letters to all relevant employees
• A new duty to refrain from producing irrelevant documents
• A new step of “Basic Disclosure”, in which parties must disclose the documents on which they rely and which are necessary for the other party to understand the case against it at the same time as serving their statement of case, unless the case falls within one of the following exceptions:

o The parties agree to dispense with it;

o The court orders that it is not required; or

o It would involve one or more of the parties disclosing more than 500 pages

• A requirement for parties to specify when serving their statement of case whether or not they will seek additional “Extended Disclosure” from the other parties
• A new List of Issues for Disclosure to be prepared by claimants as a basis for determining the scope of any Extended Disclosure on an issue-by-issue basis
• A revised disclosure menu with five models:

o Model A: no further disclosure, except for known documents that are adverse to the disclosing party

o Model B: Disclosure of known adverse documents plus Basic Disclosure to the extent this has not already taken place

o Model C: Disclosure of known adverse documents plus specified documents or narrow classes of documents related to particular issues

o Model D: The old “standard disclosure” model in which a party discloses all documents that either support or are adverse to its own case or another party’s case; the court must satisfy itself that this approach is reasonable, proportionate and appropriate in order fairly to resolve the issues in question, in order to address the perceived over-use of standard disclosure

o Model E: Disclosure of all standard disclosure documents, plus “train of enquiry” documents that may lead to the identification of further documents for disclosure; this is to be reserved for exceptional circumstances

• A new type of hearing known as the Disclosure Guidance Hearing in which parties can seek guidance from the court on disputed disclosure issues before or after a case management conference. Parties will have to be represented at such hearings by a person with direct responsibility for the conduct of disclosure.

CMS has submitted a response to the consultation, which can be accessed here. The key themes of the response are as follows:

1. We agree with the Disclosure Working Group that the current disclosure scheme is no longer fit for purpose in the electronic age and is excessive in its scale, cost and complexity.
2. We consider that the proposed reforms are correct in principle, but that certain details could be improved in order to ensure that the desired cultural change is achieved:

a. A greater use of costs sanctions may be required in order to ensure that the new duties imposed on the parties are observed;

b. The proposed exemptions to the Basic Disclosure are too broad and risk undermining the objective of moving away from standard disclosure as the default;

c. Judges should be encouraged to treat Model C as the default option in most commercial cases, as the option most likely to deliver costs savings while ensuring equality of arms between the parties;

d. Disclosure Guidance hearings should result in binding orders and should be heard by judges with the appropriate training and experience to evaluate the most appropriate option in each case, taking into account developments in technology-assisted review

e. The pilot should be designed in such a way that feedback can be monitored on an ongoing basis and incorporated into the final version of the scheme prior to implementation.

We consider that the success of these proposals will hinge on the willingness and ability of the judiciary to enforce real cultural change, and therefore investment in judicial training will be crucial. An immense amount of effort has gone into these proposals, which represent a genuine opportunity for significant improvement of the current disclosure scheme. Such an opportunity is unlikely to arise again in the foreseeable future. If the proposals do not succeed, then this may damage the pre-eminent reputation of the Business and Property courts and, in particular, the attractiveness of London as a centre of dispute resolution through litigation. Accordingly, we consider it vital that every step is now taken to ensure that the proposals are a success.

For more details, please read our consultation response or email the authors.